President Joe Biden is still considering a large-scale student loan write-off.
Here’s what you need to know – and what it means for your student loans.
Never say never when it comes to student loan forgiveness. After extending his student loan deferral for an unprecedented fourth time, Biden provided student loan borrowers with another financial lifeline. The next question is: Will your student loan be canceled?
White House: Biden Considers Student Loan Removal
Biden is still considering canceling a student loan. Here was the latest exchange between a journalist and White House Press Secretary Jen Psaki at Wednesday’s White House press conference:
Journalist: “And has the President, at this point, ruled out a possible executive-wide cancellation of a large-scale student debt?”
Κηάκη: “It has not ruled out the possibility, but I have no information about it.”
The good news for student loan borrowers is that wide student loan cancellation is not off the table. However, it is not clear if this means that it is a strong possibility. Based on Psaki’s comments, it does not appear that Biden has changed his position by extending the student loan deferral period until August 31, 2022. Biden has not recently commented on any plans to cancel a large-scale student loan. Instead, it has focused on targeted student loan cancellation for specific groups of student loan borrowers, such as civil servants, disabled borrowers, and borrowers who have received student loan forgiveness through deferral to repayment.
Biden still wants Congress to cancel student loans
Biden did not waver in his position that Congress should cancel student loans for borrowers. As a presidential candidate, Biden said Congress would have to cancel up to $ 10,000 in student loans. Psaki reminded the public of the president’s position. “And I would note that, again, he would encourage Congress to send him a bill to cancel $ 10,000 in student debt, something he talked about he was looking forward to signing in the campaign.” Biden said he would sign any bill to cancel the student loan sent to him by Congress. To date, Congress has not sent him a single bill to cancel a large-scale student loan.
It is not clear what the cancellation of the student loan would be like
The idea of ”student loan cancellation” sounds exciting to student loan borrowers. However, it is not clear what the policy might be, if any. Will all student loan borrowers receive some form of student loan cancellation? Will only some borrowers receive a student loan cancellation? What are the criteria? Are there any restrictions? What is the probable time? How much student loan write-off would there be? There are no answers to any of these questions. The Progressive Democrats are demanding the cancellation of a $ 50,000 student loan (and in some cases, a total student loan cancellation). However, Biden never backed more than $ 10,000 in student loan forgiveness. If there is any widespread cancellation of a student loan, Biden could decide before the midterm elections on November 8, 2022. Why? It could be politically beneficial for Biden to provide more student loan cancellation before the election. With only a small majority in Congress, Democrats want to retain power for the next two years of Biden’s presidency. The Progressive Democrats in Congress have protested that the lack of a student loan write-off could mean that the Democrats will lose the midterm elections.
For now, student loan borrowers will need to prepare for the resumption of student loan payments from September 1, 2022. There is no guarantee that Biden will offer a wide student loan forgiveness, but the hope remains.
Here are some of the best ways to pay off student loans: